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Etihad Airways defends 'subsidies', says is David fighting Goliaths

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Etihad Airways chief James Hogan defended the UAE carrier Tuesday against harsh attacks from US airlines over subsidies, saying his company was a "David" battling the US "Goliaths".

[WASHINGTON] Etihad Airways chief James Hogan defended the UAE carrier Tuesday against harsh attacks from US airlines over subsidies, saying his company was a "David" battling the US "Goliaths".

Hogan told an aviation industry summit in Washington that airlines everywhere benefit from state support, dismissing the claims of unfair competition by Gulf carriers in a report released by the top three US airlines.

As a battle heats up between Gulf airlines and rivals in Europe and the US, he accused the three US carriers - American Airlines, Delta Airlines and United Airlines - of themselves hiding behind protection.

"The world's two largest airline markets, the United States and the European Union, are closed, giving their own airlines a huge advantage in scale and scope," he told the US Chamber of Commerce Foundation's 14th Annual Aviation Summit.

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Mr Hogan said established aviation giants were built on various kinds of state support, including preferential market access, infrastructure and airports, hardly different from what Gulf carriers Qatar Airways, Etihad and Emirates are accused of.

He also cited the government-backed bailouts of US carriers when they failed.

"Many, many airlines, including many in this room, have benefitted from years of government bailouts, write-offs and loans, everything from bankruptcy protection to covering pension fund obligations, to straight-out financial payments." "Etihad is a David who's been facing Goliaths since 2003," he argued.

"The three biggest US airlines working together carry 34 times more" passengers.

In early March, American Airlines, Delta Airlines and United Airlines, along with US airline labour groups, accused the Gulf three of enjoying interest-free loans, subsidised airport charges, government protection on fuel losses, and below-market labour costs that are considered unfair subsidies by the World Trade Organisation.

They called on the US government to open new talks over bilateral air agreements to address what they said are violations of those pacts, giving the Gulf carriers unfair competitive advantage.

Qatar Airways chief Akbar al-Baker said on Monday the problem was that the US carriers do not differentiate between what is a subsidy and what is the "legitimate" equity that a state-owned carrier gets.

Delta anyway flies "crap airplanes that are 35 years old," he added.

AFP

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